China often uses financial threats as leverage - it owns almost a third of the U.S. debt and every now and then, China threatens to sell part of its debt holding, knowing U.S. interest rates would rise and that would slow U.S economic growth. So, it wouldn't surprise me that they'd use a similar tactic to lower the price of Bitcoin so they could buy massive amounts at a lower price
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Yeah seeing that with chinese tourists who aren`t allowed to travel to Seoul anymore because South Korea added new defense systems against North Korea. China is powerful and will be powerful in the future.
I agree. It's not Russia - it's China that's America's rival.
I think that America still has the upper hand over both though.
Obviously it is possible that China leverages it's holdings, however, America can just default on foreign debt if they choose to do so. The Chinese military power does not match America's and thusly they cannot collect the outstanding debt by force.
Additionally, the US or the FED could basically devalue the debt that China holds by printing more and more money. Realistically, China's assets would soak up 1/3 of the loss in value of the dollar without hurting the American economy at all.
Obviously, either would be a drastic measure of the American government, however it shows you that America is far from done or losing the upper hand.
In the case of money printing for example, I think the Chinese economy would be hurt more drastically then the American, because the additional dollars created would be spend withing the US and not in China practically punishing China's economy if the US government implements a sensible policy that supports the American population via economic growth.
a very informed and insightful response, @granunic0rn
Yeah maybe...
Exactly - I think it is quite probable.
Yes. Exactly this ^
Makes sense. I wonder what would happen if they let their currency float.
exactly!
Would be very interesting with dramatic implications.
it certainly would!
I guess the first thing that would happen is that it would to a large extent destroy their domestic industries because they will no longer be competitive on world markets. 😢 Maybe that is why they are now focusing on high quality products instead of just being the cheapest. In anticipation of an economically independent USA in terms of consumer goods, but even as far as oil is concerned. Very much like Germany. Germany used to make low quality products, and then I guess once they built up their customer base and internal manufacturing infrastructure, they started focusing on quality and eventually became synonymous with quality.😁
those are some very good points - didn't know that about Germany, but it makes sense to me now
There is this book The German Genius. I saw an interview with the author
😀